In this illustration, Elon Musk’s Twitter account is displayed on the screen of a mobile phone with the Twitter logo in the background. A whistleblower’s complaint that Twitter misled federal regulators about the company’s security risks could provide Elon Musk with fresh ammunition in his bid to get out of buying the company for $44 billion.
Sheldon Cooper | Lightrocket | Getty Images
Elon Musk’s legal team filed another notice on Tuesday to terminate his $44 billion deal to buy Twitter, citing additional reasons.
Twitter shares were down more than 1% in pre-market trade.
The latest filings come after Twitter’s former head of security Peiter “Mudge” Zatko alleged earlier this month “extreme, egregious deficiencies” by the social media firm related to privacy, security and content moderation.
On July 8, Musk’s legal team initially filed a notice to the U.S. Securities and Exchange Commission (SEC) to terminate the Twitter acquisition. Musk’s legal team alleged that “Twitter has not complied with its contractual obligations.”
The follow up notice, disclosed on Tuesday to the SEC, cites allegations made by Zatko as additional reasons to terminate the deal.
“Allegations regarding certain facts, known to Twitter prior to and as of July 8, 2022, but undisclosed to the Musk Parties prior to and at that time, have since come to light that provide additional and distinct bases to terminate the Merger Agreement,” Mike Ringler, Musk’s legal representative from Skadden, Arps, Slate, Meagher & Flom LLP wrote in a letter to Twitter’s legal chief.
Ringler said in the letter that the latest termination notice is “not legally necessary ” to end the merger deal, but is being delivered in case the July 8 filing is “determined to be invalid for any reason.”
The letter on behalf of Musk said the Zatko complaint “alleges far-reaching misconduct at Twitter—all of which was disclosed to Twitter’s directors and senior executives, including (CEO) Parag Agrawal—that is likely to have severe consequences for Twitter’s business.”
Musk’s lawyer said Zatko alleges that Twitter is in “material noncompliance” with its obligations under its 2011 agreement with the Federal Trade Commission. The letter laid out some of Zatko’s other allegations including claims that Twitter is “uniquely vulnerable to systemic disruption resulting from data center failures or malicious actors,” something senior management knew about but “ignored and sought to obfuscate.”
“These allegations, if true, demonstrate that Twitter has breached the following provisions of the Merger Agreement, thereby giving the Musk Parties the right to terminate the Merger Agreement pursuant to its terms as more fully described below,” the letter said.
Twitter and Elon Musk will go on trial on Oct. 17 in Delaware to resolve Musk’s attempt to cancel his acquisition of the company unless they reach a settlement first.
– CNBC’s Lora Kolodny contributed to this report.
This is breaking news. Please check back for updates.
Senate Democrats fume as Republican seek to tie Ukraine funding to border security
Raymond James Stadium implements new sensory room inspired by Todd Bowles' son
Amazon packages reportedly overwhelm small post offices, delaying other mail
Google’s Geothermal Energy Project Now Powers Nevada Data Centers
Investment titan Charlie Munger dies aged 99: Warren Buffett’s longtime business partner at Berkshire Hathaway passes away ‘peacefully’ at California hospital
Feeding Tampa Bay serves hundreds a traditional meal for Thanksgiving
The Countach DiCaprio Crashed In Wolf Of Wall Street Is Going To Auction
Cruise CEO And Co-Founder Kyle Vogt Steps Down
How to Respond to Relatives Who Feel the Need to Comment on Your Food and Body
Chris Pine Has Heard Rumors of a Possible Dungeons and Dragons 2
Prince William Doesn’t Think King Charles Is ‘Competent’ and Doesn’t Like the Way He’s Ruling, Expert Claims
The U.S. Is All-In On Green Incentives. Will It Work?
Bill O’Brien says that who starts at quarterback isn’t up to him
‘The Crown’ Season 6 Will Cover These Critical Years For the Royal Family
Direct Impact: Black Trans-Led Orgs Don’t Require Intermediaries
Finance24 hours ago
Comparing Job Offers: Going Beyond Base Salary
Lifestyle11 hours ago
Egypt’s El Gouna Film Festival Set to Hold Special Edition Dec. 14-21 Following Postponement
News16 hours ago
SEAN HANNITY: Biden is a ‘pathetic’ excuse for a president
Tech19 hours ago
Tech Moves: Leafly board member departs; Uber Freight hires ex-Convoy comms lead
News11 hours ago
Tesla’s future riding on the Cybertruck
Finance23 hours ago
These 3 Gold Stocks Are Outperforming Gold Itself. Fear Hedge.
Auto13 hours ago
Powerful Lotus EV Charger Adds 89 Miles Of Range In Five Minutes
Finance21 hours ago
Taylor Swift’s Funflation: Best Buy’s Retail Warning